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Country's biggest ever tax reform- GST was launched at the stroke of midnight on Friday by President Pranab Mukherjee and Prime Minister Narendra Modi in a special function held at the historic Parliament House Central Hall.

India, scraping all the previous central and state taxes at the stroke of midnight on Friday launched one centralised Goods and Service Tax(GST).

Country's biggest ever tax reform was launched by President Pranab Mukherjee and Prime Minister Narendra Modi in a special function held at the historic Parliament House Central Hall at midnight on June 30.

Speaking at the special GST rollout function, Prime Minister Narendra Modi said the "GST means Goods and Service Tax but it also means Good and Simple Tax".

There are 500 types of taxes that play their roles. Today(June 1) we are getting rid of them," Modi said. "From Ganganagarto Itanagar and Leh to Lakshadweep, it is one nation, one tax."

The day marks a decisive turning point in determining the future course of the country, he said, adding GST would ensure one nation, one tax.

President Pranab Mukherjee, who was also India's Finance Minister during UPA's government in 2011 congratulating GST council said, "this historic moment is the culmination of 14-year long journey which began in December 2002."

"GST will make India's exports more competitive and provide a level-playing field to domestic industry to compete with imports," he added.

Finance Minister Arun Jaitley said the launch of India's biggest ever tax reform since Independence will help the economy grow by 2 percent.

"We have done this at a time when the world is facing a slow growth, isolationism and lack of structural reforms. With the GST, India has shown that these forces can be overcome through display of inclusion, openness and boldness," Jaitley said.

“It shows India can collectively think and act with maturity for a broader purpose,” he added.

The GST was first proposed in 2003, the idea of the one centralised tax was bogged down for years in bipartisan debate, with political parties in government trying to push it and those in opposition dragging it down. Before Modi came to power three years ago, his party was not particularly in favour of the GST.

Under the new system, goods and services will be taxed under four basic rates - 5%, 12% 18% and 28%. Over 1,200 items, from shampoo to tea to automobiles, have been put in these four broad tax categories.